Norwegian CSD VPS has confirmed that from 1 November only trade date will be mandatory in its pre-matching criteria. Proposed requirements to include the buyer and seller BIC addresses and/or the counterparty’s VPS account number will not be made mandatory after all.
However, says a spokeswoman for DnB NOR in Oslo, clients will be encouraged to provide the additional information, even though it is optional. “The use of BIC and VPS account numbers for pre-matching will reduce the risk for mismatching, and the VPS will eventually establish this as mandatory criteria in the future,” says the spokeswoman.
The VPS had promised more detailed information regarding implementation and requirements for using counterparty BIC and VPS account numbers in June, but this has yet to be released. However, the VPS has informed DnB NOR that they intend to meet with the Market Practice Group to discuss further criteria during August/September, and will release more information at that time.
“While this is a step in the right direction, trade date does not address the problem of potential settlement mismatching to an incorrect account,” says a spokeswoman for DnB NOR. “In an effort to reduce this operational risk, DnB NOR will actively work with the VPS to implement the additional criteria as soon as possible.”